Financial Audit

First of all, what is the purpose of an audit?

The purpose of an audit is to determine whether the annual accounts, simplified annual accounts and consolidated annual accounts of a company for a given financial year have been prepared in accordance with the provisions of the Accounting Act and whether they give a true and fair view of the company's assets, liabilities, financial position and profit or loss.
Wow, that is rather textbook, slightly academic wording. But the fact is that it doesn't get much simpler than that. Normally, such a complicated, complex formulation would seem mystical to many people. And maybe even incomprehensible. But believe me, we understand it and we do our job accordingly. It is indeed a very complex task, requiring a high level of expertise and many years of experience.
It follows, of course, that not everyone can be an auditor.

So let us take a brief look at when an audit is required.

When preparing your accounts, you may find that your company's turnover, or sometimes the number of employees, has increased significantly compared with the previous period. It is worth taking note of these changes, as the Accounting Act may now require the company to be audited.
It is therefore worth choosing an accountancy firm that keeps abreast of these changes. This assumes, of course, that the firm's activities include auditing.
It helps to know what the Accounting Act says. Article 155 of the Accounting Act requires all double-entry bookkeeping companies to carry out a statutory audit.
Well, it's a bit more complicated than that. Because this legislation exempts you from it, depending on the threshold. So it is not mandatory for all double-entry companies? Let's find out!

When is an audit not compulsory?

For an audit not to be mandatory, two conditions must be met. One is the size of the turnover and the other is the average number of employees.

For the sake of clarity, we will be more specific:

If the entrepreneur's average annual net turnover in the 2 financial years preceding the financial year in question did not exceed HUF 300 million (if the entrepreneur started his business during the year, it must be converted to the annual level), and if the entrepreneur's average number of employees in the 2 financial years preceding the financial year in question did not exceed 50, the entrepreneur is not required by law to have an audit.
It is very important that these two conditions are met together!

Finally, what are the most important tasks of an auditor?

Two of the tasks in the field of auditing are highlighted. Our aim is to provide information, so we will present these tasks in a non-exhaustive manner and will not go into all the details. We do not intend to provide a textbook, but only general information. Please take a look for us!

• Checking compliance

During the audit, we check whether the form and content of the financial statements prepared comply with the applicable requirements (this may be the Accounting Act, any applicable sectoral government regulations or other legal requirements). At the same time, we review the supplementary notes and annual reports. 

• Finalise, review results and prepare reports. Carry out and document any necessary internal consultations.

This includes compiling and reviewing audit adjustments in the accounts, preparing and signing closing documents, preparing reports and preparing various audit-related documents.